Russia's record harvests impacting Kazakhstan's milling industry

by Arvin Donley
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ASTANA, KAZAKHSTAN – A reduced number of grain transportation vehicles from Russia has negatively impacted the flour milling industry in Kazakhstan, according to a Feb. 12 Global Agricultural Information Network (GAIN) report from the U.S. Department of Agriculture.

The report noted that Kazakhstan has a joint venture arrangement to use Russian equipment for moving grain and flour, but Russia’s recent record harvests have reduced the number of available grain hoppers and closed wagons from that country.

“This deficit has limited shipments and caused many mills to work under capacity or temporarily to stop their operations,” the report said. “In previous seasons, mills were busy through late December; however, this season mills worked partial days and was closed for weekends. Some mill claimed they planned for 130-140 wagons shipments but only received 30-40 wagons.”

The report also said that Kazakhstan no longer hides the fact that it is using Russian imported wheat in its flour mills.

“Until very recently it was taboo for millers to use anything other than Kazakh wheat, and so they would not report the use of wheat from other countries,” it said. “However, the procurement prices for the domestic market set by the government-owned grain operator Food Contracting Corporation (FCC) were unattractive to flour millers, and they began to report their use of cheaper Russian grain.”

Kazakhstan produced 4.1 million tonnes (wheat equivalent) of flour in 2017, the report said, an increase of 3% from the previous year. 

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